For a long period of time, two alien races, the Kree and the Skrulls, have been in constant war with each other. Since the Kree are the ultimately superior species due to their technological advancements, the Skrulls have been numbered down significantly, to the brink of extinction. The Kree Empire continue to attempt to wipe the Skrulls from the face of the galaxy. In 1995, in the height of the war, Vers resides on Hala. She has constant nightmares that haunt her, mainly consisting of an aircraft crash on a foreign peninsula, and watching a woman being murdered in front of her by an unknown Skrull assailant. She also remembers this as the earliest memory of when she gained her powers that allow her to shoot photon blasts out of her fists. Vers now trains with Yon-Rogg, aiming to become a member of Starforce. Although Yon-Rogg believes she is ready, the Supreme Intelligence, the artificial intelligence that rules the Kree Empire, figures otherwise but nonetheless allows Vers on the team, which consists of Minn-Erva, Korath, Bron-Char, and Att-Lass.

Yon-Rogg gives the Starforce a briefing, to rescue a Kree operative named Soh-Larr. Yon-Rogg informs the team that Soh-Larr has been captured on the planet Torfa. Yon-Rogg instructs the team to perform an incursion on the planet, so Vers and the rest of the Starforce land underwater and use their suits to reach the surface. Soon they realize that the Torfan natives are Skrulls, and that the mission was an ambush.

Vers is abducted by Skrull General Talos (disguised as Soh-Larr) who kidnaps her to a Skrull spacecraft, while the rest of the Starforce retreat. On the spacecraft, Talos gains access to Vers' memories from various points in her life. Vers awakens just as Talos unlocks her memories, revealing that he wants information from her pertaining to a Light-Speed Engine. She orchestrates an escape, with Talos, Norex and two other Skrulls in pursuit, crash-landing to Planet C-53 (Earth).

Vers and the Skrulls crash in Los Angeles. While Talos and the Skrulls assume the role of surfers on a beach the next day, Vers crashes through the roof of a Blockbuster Video in the middle of a shopping plaza. After a brief communication with Yon-Rogg, learning she will be stranded on Earth for the next 22 hours, she attracts the attention of S.H.I.E.L.D. after a night-shift Los Angeles Police Department officer reports her in. Nick Fury and Phil Coulson led by Keller arrive at Los Angeles to interrogate Vers, dismissing her Kree authority and her claims that the Skrulls have arrived on Earth.

The interrogation is interrupted by one of the Skrulls: Vers gives chase to the Skrull on a subway train, but the Skrull evades her and escapes amid a crowd at a train station. Fury and Coulson give chase to Vers, but Fury realizes that Coulson was actually abandoned at the shopping complex, and the Coulson sitting passenger-side next to him is a second Skrull impostor. The two have a scuffle, and the Skrull is killed when their car crashes into oncoming traffic.

Vers utilizes a Skrull crystal containing her lost memories and begins recollecting them. She dresses in a civilian outfit she stole from a display and steals a motorcycle to drive to Pancho's Bar in the nearby town of Rosamond. Fury and Keller, who at this point has been compromised by Talos, take possession of the deceased Skrull and while performing an autopsy, Keller authorizes Fury to work with Vers, and eventually hand her in S.H.I.E.L.D. custody. Fury finds Vers at the bar, and now fully convinced that the Skrulls are a threat, the two question each other to ensure that they are not Skrull impostors.

Fury takes her to the Joint NASA USAF Facility in Nevada to confirm Vers' claims of her origins on Earth. She learns that she was a fighter pilot for the United States Air Force alongside a fellow comrade, Maria Rambeau, both under the tutelage of Wendy Lawson for Project P.E.G.A.S.U.S.. Vers recognizes Lawson as the woman murdered in her dreams and later learns from Yon-Rogg that she was a Kree named Mar-Vell.

Fury reports their location to Keller and a posse of agents led by Keller arrive, including Coulson. Upon realizing that Keller had been compromised by Talos the whole time, Fury goes rogue with Vers; Coulson allows the two to escape. Motivated to seek answers from Rambeau, Fury, and Vers, accompanied by Goose, a cat who they encountered at the facility, hijack a Quadjet to the Rambeau Residence in New Orleans, Louisiana. Both Rambeau and her daughter Monica are surprised to see Vers still alive.

The two identify Vers as Carol Danvers, a fighter pilot who was seemingly killed with Lawson in a test flight gone awry. They also identify Goose as Lawson and Danvers' pet. Talos and Norex arrive at the Rambeau Residence, only to negotiate a temporary alliance after Talos reveals that he was in possession of a black box from the plane crash. Talos reveals that Danvers has been deceived by the Kree and that the Skrulls are simply homeless refugees constantly on the run from the Kree, on the brink of extinction.

Upon hearing the recording from the black box, Danvers finally recollects the memory of what happened: The assassination was orchestrated by none other than Yon-Rogg, who had uncovered Mar-Vell's deception. Mar-Vell instructed Danvers to destroy the energy core powering the light-speed engine, but in an attempt to destroy it, Danvers gained cosmic abilities after absorbing the energy from the exploding engine. With no recollection of her memories, Yon-Rogg was authorized by the Supreme Intelligence to train her into becoming a Kree operative.

Talos confides in Danvers that Mar-Vell was actually a Kree double-agent who was attempting to help the Skrulls by testing the light-speed engine, which can help them flee Kree occupation forever, and that the black box and Danvers' memories contained the coordinates to a former laboratory cloaked in Earth's orbit that Mar-Vell had used, containing the last of the Skrull refugees as well as the energy core that powered the engine.

The next day, Yon-Rogg arrives on Earth to confront Danvers. He quickly realizes that the Danvers he was communicating with was Norex, and swiftly executes him upon learning of the laboratory orbiting Earth, and learning that the source of the energy core is the Tesseract. Danvers, Fury, Talos, Maria, and Goose take the Quadjet to the laboratory, and Talos is reunited with his wife and daughter.

Danvers finds the Tesseract, but the Starforce ambush them and place Danvers under stasis to confront the Supreme Intelligence. In a final conversation with the Supreme Intelligence, Danvers removes the inhibitor that has been limiting her full power potential and engages in an all-out battle with the Starforce. Fury realizes that Goose is actually a Flerken, and witnesses her abilities firsthand after she swallows the Tesseract and several Kree soldiers (echoing an earlier scene where Talos expressed fear of Flerkens and insisted that Goose was not a cat). In a battle for the Tesseract, Danvers overpowers Korath, Bron-Char and Att-Lass while the Skrulls escape on the Quadjet with Rambeau and Fury. In the process, Talos is shot by Yon-Rogg, rendering him inoperable to fight.

In a rage, Yon-Rogg authorizes Ronan and the Accusers to dispatch Kree Ballistic Missiles at Earth to kill Danvers and the Skrulls. Danvers destroys the missiles and one of the Kree warships, prompting the Accusers to retreat. Minn-Erva, the last operable Starforce member, intercepts the Quadjet to the Mojave Desert, but Rambeau shoots her down. Yon-Rogg arrives on Earth, and challenges Danvers to a duel, but she instantly incapacitates him with a photon blast, and sends him back to Hala with a warning for the Supreme Intelligence, declaring war.

In the aftermath, Goose claws and blinds Fury's left eye while his guard is down. The Skrulls take temporary shelter at the Rambeau Residence, where Talos begins to recover from his injuries. Before Danvers departs Earth with the Skrulls to find them a new home, she hands Fury a modified Transmitter Pager to call her in the event of an emergency. While drafting the Protector Initiative, Fury, upon learning that Danvers' call sign was "Avenger" during her time in the Air Force, renames it to the Avengers Initiative in her honor.

In a mid-credits scene set in 2018, after Fury's death in the Snap, several of the remaining Avengers (Steve Rogers, Natasha Romanoff, Bruce Banner and James Rhodes) analyze Fury's pager at the New Avengers Facility, before Danvers herself appears, asking where he is.

In a post-credits scene, Goose regurgitates the Tesseract on Nick Fury's desk, while he wasn't in his office.